Thursday, July 23, 2015

My thoughts on Limited Edition items.

Limited Edition - What is the point?

It concerns me as a person who enjoys games and gaming that
there continues to be an increase in limited edition items. I look at many projects that are on
Kickstarter and the limited items that become unlocked after a certain funding
point has been reached. This has led to
the opportunist and speculative buyer coming to the fore.

I remember years ago running Wizkids events and the limited
edition models that were given as prizes.
What we had was the game being dominated by a few individuals, who would
attend as many events as they could to win the limited edition prizes. This meant that a few individuals cornered
the market, sold the spares for profit and didn't endear themselves to many in
the community.

(TIME FOR A DISCLAIMER: These people did nothing legally
wrong. They were good players and in all
the cases I knew of, good people. They
used the system to profit them, which while many may find morally bankrupt, is
not breaking any rules in how prizes were won and what they could do with them
after having been won.)

The madness that comes when people (particularly those who
are passionate about their hobby) see limited edition means they automatically
believe that their purchase is worth more than what they paid for said
item. This is not necessarily so.

My hobby is particularly difficult to give an accurate
example of, as the community seems to have not grasped the concept of
worth. So I'll give an example with trading
cards. Up until the late 70's and
possibly early 80's trading cards had some value beyond their intrinsic
cost. With a number of changes in the
industry there was suddenly and explosion in quantity, price and shops selling
cards. At one point there were card
shops everywhere, all trying to compete.
Then the bubble burst. People who
had bought sealed boxes of cards found that there might not be any worth in
their purchases at all. While the box
may have a particularly rare card inside worth a considerable amount, there was
no guarantee. Thus the mass produced
product became less than the card it was printed on.

Another example was where an expert in sports memorabilia
gave his opinion that buying the limited edition signed cricket bats or other such
product was unlikely to get a person any more than the value they initially
paid for the item. A true limited
edition item worth money would be the entry tick signed by a sportsman who won
the game, broke a record and the like.
In this case it is truly limited and worth something to a true
collector.

What does limited edition mean in a gaming context. It only has an appeal in two ways; first is
its game attributes and secondly as a collectible piece. If in the first case it is a game changing
item, then all hell breaks loose as people who play competitively seek them
(like rare cards in Magic:The Gathering).
Where money is involved people can become rather aggressive and
sometimes obnoxious. The richer players
will get the limited items, and the rest languish and ruminate over how to
defeat an opponent with this game changing item.

Where the item is a collectible piece you attract the people
who wish to have a complete set, and those who are speculative investors. I myself am a collector whose OCD drives me
to complete sets, and to use what it is I obtain. Concept of worth will be determined long
term, and this is where the limited edition value of items in the industry (I
think) has not been properly tested.

When the recent global financial crisis hit, a number of
wealthier individuals who had lots of items to
sell found that they got very little in return investment. Limited edition meant nothing when many
people didn't have much money and were more worried about feeding themselves or
keeping a roof over their head. Having a
limited edition during a depression won't net you much. It was a good time for those people who had
money and could capitalise on another misfortune. I even recall that one case came to my
attention where the unfortunate person selling was lucky enough to run into a
generous person who actually paid them more than they were asking, feeling that
to take advantage of a person in such dire circumstances was morally
irresponsible (I believe the person was a religious one).

Where you have a thriving economy and a growing number of
wealthy persons with cash in excess of needs, then you can possibly make a
return on the item. In a lot of cases
these can be people who as a child could never afford the items, but now as a
successful and wealthy individual they can now afford to offer more than any
sensible person would be willing to pay.

I find that the mentality here in Australia is that due to
the cost of freighting an item to this country, it's smaller pool of limited
edition items, can potentially earn more than what should be the case. The sellers know this, and take advantage of
the fact that to buy the item from another overseas source would be as
expensive. I see that limited edition
items overseas sell for far less than what Australian sellers are asking. They argue (the sellers) that sure you can
compete for the item, but I have it here and now at this amount. They may think "remember the exchange
rate, the cost of freight, my price is what you want to buy it for, trust me,
I'm cutting my own throat (Dibbler: humour from Discworld) to sell you this
item".

So my opinion with thinking about limited edition items is
this.

Decide, and be honest about this, whether you
want the item to be used, to form part of a collection, or that your only
interest is making money from the item.

If you are a purchaser, research the item and
its initial worth.

If you are a seller, then consider the economic
environment and how it will affect your expectation of price.

My own advice is never pay more than what the limited
edition piece sold for (inflation modified).
This price would only be paid if the original bill of sale was included,
the item was still sealed and has not in any way been used. If it has been used under any circumstances,
seals broken, damage of any sort then maximum of 50% reducing downwards
depending on quality.

I have in the past paid far more than I should have for some
items, and the person who did so gloat at my expense whenever they get a chance
to. Don't be a victim of your own
desire, buy wisely and sell responsibly.